Correlation Between Thrivent Natural and F/m Investments
Can any of the company-specific risk be diversified away by investing in both Thrivent Natural and F/m Investments at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Thrivent Natural and F/m Investments into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Thrivent Natural Resources and Fm Investments Large, you can compare the effects of market volatilities on Thrivent Natural and F/m Investments and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Thrivent Natural with a short position of F/m Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Thrivent Natural and F/m Investments.
Diversification Opportunities for Thrivent Natural and F/m Investments
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Thrivent and F/m is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Thrivent Natural Resources and Fm Investments Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fm Investments Large and Thrivent Natural is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Thrivent Natural Resources are associated (or correlated) with F/m Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fm Investments Large has no effect on the direction of Thrivent Natural i.e., Thrivent Natural and F/m Investments go up and down completely randomly.
Pair Corralation between Thrivent Natural and F/m Investments
Assuming the 90 days horizon Thrivent Natural is expected to generate 3.02 times less return on investment than F/m Investments. But when comparing it to its historical volatility, Thrivent Natural Resources is 19.33 times less risky than F/m Investments. It trades about 0.33 of its potential returns per unit of risk. Fm Investments Large is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,694 in Fm Investments Large on November 2, 2024 and sell it today you would earn a total of 115.00 from holding Fm Investments Large or generate 6.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Thrivent Natural Resources vs. Fm Investments Large
Performance |
| Timeline |
| Thrivent Natural Res |
| Fm Investments Large |
Thrivent Natural and F/m Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Thrivent Natural and F/m Investments
The main advantage of trading using opposite Thrivent Natural and F/m Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Thrivent Natural position performs unexpectedly, F/m Investments can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in F/m Investments will offset losses from the drop in F/m Investments' long position.| Thrivent Natural vs. Barings Active Short | Thrivent Natural vs. Ultra Short Fixed Income | Thrivent Natural vs. Cmg Ultra Short | Thrivent Natural vs. Siit Ultra Short |
| F/m Investments vs. Fm Investments Large | F/m Investments vs. Cognios Market Neutral | F/m Investments vs. The Hartford Growth | F/m Investments vs. Delaware Limited Term Diversified |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.
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